Manning v. Bleifus
Decision Date | 09 December 1980 |
Docket Number | No. 14671,14671 |
Citation | 272 S.E.2d 821,166 W.Va. 131 |
Parties | Earl MANNING et al. v. Leo A. BLEIFUS, Jr. et al. |
Court | West Virginia Supreme Court |
Syllabus by the Court
1. "It is presumed that parties enter into a contract with the intention of accomplishing some purpose by it; and, therefore, courts will not give to the contract a construction which will render it void if it can reasonably be interpreted in such a way as to give it effect." Phillips v. Rogers, 157 W.Va. 194, 200 S.E.2d 676 (1973), Syllabus Point 1.
2. A "subject to the approval of financing" clause in a real estate sales contract is an enforceable condition precedent to an otherwise valid contract and the clause requires a buyer to make reasonable, good faith efforts to obtain financing.
3. Whether a buyer made reasonable, good faith efforts to obtain financing is a fact question that will not be reversed on appeal unless clearly wrong.
4. If there is an adequate remedy at law, courts will not hear vendors' real estate sales contract complaints in a suit for specific performance.
Robinson & Dickinson and Robyn Ruttenberg, Wheeling, for appellants.
Riley, Yahn & Cooey, Robert A. Yahn and Craig Broadwater, Wheeling, for appellees.
On May 9, 1977, the Mannings agreed to sell their residence to the Bleifuses by a contract that provided that the Mannings be paid $1,000 earnest money and $76,000 in cash upon delivery of a deed, all of which was "subject to the approval of financing," a phrase inserted by the buyers. Bleifus applied for a loan for the full purchase price at his bank. It appraised the property at $68,000 and offered to loan Bleifus eighty percent (80%) of that amount. He did not apply elsewhere for financing.
On May 23, Bleifus, by his attorney, notified the Mannings that he was unable to secure financing and considered the contract null and void. The Mannings sued in the Circuit Court of Ohio County for specific performance or damages amounting to the difference between the contract price and the ultimate sale price.
After both parties filed summary judgment motions, the court ordered the case to proceed to trial and required Manning to sell the property to mitigate damages, giving the Bleifuses twenty-four hours to match the best price offered. Bleifus met the $63,000 offer and the property was conveyed by deed dated October 27, 1977. Bleifus borrowed from his bank $70,000 to purchase the property, secured by deed of trust on it and on the Bleifus residence.
On January 13, 1978, after the damages were determined, Manning moved for summary judgment. The motion was denied but the court held the "approval of financing" clause to be a condition precedent to a valid contract and convened an advisory jury to determine whether Bleifus made reasonable efforts to secure financing. It found Bleifus had failed to make reasonable efforts and the court decided that the Mannings were entitled to the difference between the contract price and eventual sale price, plus interest.
The Bleifuses contend that circuit court erred by concluding that the contract was valid, that the Bleifuses did not make a reasonable effort to obtain financing, that the jury issue should be limited to that question, that litigation of misrepresentation and reliance matters was not permissible, and by proceeding at law rather than in equity.
We affirm the circuit court.
"It is presumed that parties enter into a contract with the intention of accomplishing some purpose by it; and, therefore, courts will not give to the contract a construction which will render it void if it can reasonably be interpreted in such a way as to give it effect." Phillips v. Rogers, 157 W.Va. 194, 200 S.E.2d 676 (1973), Syllabus Point 1. Although the phrase "subject to the approval of financing" is far from specific, it is not so indefinite or devoid of meaning as to void the contract.
A majority of jurisdictions have interpreted "subject to financing" clauses to be enforceable conditions precedent to a real estate contract. See generally 81 A.L.R.2d 1338, §§ 1-2 ( ). See also 5 A.L.R.2d 287 ( ). But the buyer must make reasonable, good faith efforts to obtain financing. Betnar v. Rose, 259 Ark. 820, 536 S.W.2d 719 (1976); Liuzza v. Panzer, La.App., 333 So.2d 689 (1976); Williams v. Cormier, La.App., 100 So.2d 307 (1958); Rand v. B. G. Pride Realty, Me., 350 A.2d 565, 568 (1976), motion dismissed, 360 A.2d 519; Bushmiller v. Schiller, 35 Md.App. 1, 368 A.2d 1044 (1977); Solberg v. Kane, Mo., 536 S.W.2d 885 (1976); Simms Co. v. Wolverton, 232 Or. 291, 375 P.2d 87 (1962); Willeford v. Walker, Tex.Civ.App., 499 S.W.2d 190 (1973); Hanover, Ltd. v. Fields, Utah, 568 P.2d 751 (1977); Noah v....
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